Week's reprieve for ITV Digital

11:21AM BST 15 Apr 2002

THE administrators of ITV Digital were today given a further seven days by the High Court to negotiate a deal with the Football League and put an end to their bitter broadcasting contract dispute so that the company can continue in business.

Michael Crystal, QC for administrators Deloitte and Touche, said that after discussions with the key stake-holders in the company, they believed it was in the common interests of everyone concerned for the business to continue.

There was a real prospect of achieving a "restructuring of the cost base of the business" with a view to obtaining long-term investment from shareholders.

If no restructuring could be achieved within the next week, the business would come to an end and the administrators would then seek to sell it as a going concern.

Mr Crystal told Mr Justice Lightman there were "substantial obstacles" in the way of restructuring, including the position of the Football League as a major creditor.

The survival of the company "hangs on a knife edge", he said, but discussions with the League had not yet finally broken down. The administrators' proposals would be considered by chairmen of the League clubs at a meeting in Manchester on Thursday.

In the meantime, the administrators had sufficient funds to keep the company running for a week, even though the £20 million injected at the start of the administration on March 27 by ITV Digital's owners, Granada and Carlton, had now run out.

After today's hearing in London, the administrators said in a statement that restructuring had been hampered "by the unauthorised disclosure of private and confidential discussions and the campaign of negative publicity which has continued this morning and is severely undermining the administration process".

If the League rejected the latest proposals or the administrators concluded that the "on-going recriminations have undermined our ability to achieve the business plan", there would be no alternative but to sell the business and its assets.

Unless legal complications arise, the administrators will not have to return to court in a weeks time - either ITV Digital survives, or moves to sell it will go ahead.